Employee Benefits 101 – 7 Steps to a Better Benefits Strategy

The following list will outline key considerations to make your benefits strategy more powerful:


WHY are you offering benefits?

Is it to attract and retain talent? Is it out of a desire for your employees to live healthy lives? To make your employees feel valued?

The answers to these questions, and their order of importance, as viewed by your management, will shape what plans you choose, how you communicate the options and value of these plans, and ultimately how your employees view and use the plans.

For example: Your company may offer excellent benefits, but if your communication and engagement strategy is lacking, your employees may not value your offerings and could lack the understanding needed to get the most value out of their chosen plan.

As a solution, consider investing in your communication strategy to clearly outline what plans you offer, the actual value of those plans in dollars and cents (total compensation statement), and how your empoloyees can best utilize the plan while spending the least amount of money out of their pocket. This could include a drip campaign to your staff on the benefits of staying in-network, how to use telemedicine to reduce cost and save time, and the benefits of using generic medications and holistic solutions to save money.


Each year, your business is presented with a renewal from the carriers. Typically, this involves a rate increase, sighs from your CFO and HR manager, and conversations with your broker about bringing the cost down…

Unfortunately, many employers are missing the opportunity to re-examine the type of coverage they offer, ask employees for feedback to help steer the process, and to devote some time to thinking strategically about your benefits.

Instead of simply rushing through your renewal this year, consider “elevating your benefits conversation”. The first step in this process can be simply challenging your broker to go above and beyond the typical “spreadsheet drill”, typically associated with renewal season.

Consider new ways to shift your employer contribution around – Even by adding new products like dental and vision (read here for more ideas on how to use voluntary products to your advantage), and even consider wellness incentives to engage employees who care. A part of this process could involve sending out a quick employee-facing survey to get a better understanding of what your employees actually value.

D187_233_084_1200 (1)Not every dollar spent on benefits is equal – And your goal should not be simply to reduce the amount of your increase, but rather to set a budget, and get the absolute maximum value (both real, and perceived by your employees) from that budget.

This ties into our next point:



Many employees agree that employee benefits are offered to employees, primarily to attract and retain talent… Essentially to reduce turnover.

Hidden within this statement is the assumption that your benefits has value to these employees… It’s this value that actually helps keep them happy and appreciative of your overall offering to them.

In addition to the benefits themselves, you might be surprised to hear their feedback on the systems you use to administer everything.. (INSERT LINK ON EMPLOYEES AND TECH)… Even if your benefits remain nearly identical year-over-year, a more streamlined, online enrollment experience can elevate your employees perception of your benefits package, and your company as a whole.


Your approach to encouraging employees to enroll in benefits and lead healthy lifestyles MUST come from the top for maximum impact

Give your benefits a face – CEO, HR manager…


If there’s one thing we can all agree on, it’s that your employees probably don’t enjoy spending a lot of time sorting through benefits summaries before they select a plan… To the extent that many employees just renew the same plan every year because they don’t want to deal with all the details.

It doesn’t need to be this way.

Make it a priority to educate your employees this year on their choices. The better they understand your offerings, the more value they will see in them. Not to mention, if and when a health issue or emergency arises, they’ll be more empowered to make a wise decision.

Examples of relevant information include:

  • Offer in-person, and online tutorials outlining all the options
  • Use a modern online system for employees to enroll, and to access plan info later
  • Use Video whenever possible
  • Always cover the basics
  • Re-enforce in vs. out-of-network costs
  • Mention telemedicine as a cost-saver


As premium costs continue to climb, many employers are seeking to curb costs by turning to “skinny network” PPO, EPO, and HMO plans.

Before you turn to options like this, consider the disruption your employees could experience. By including doctor, specialist, and hospital preferences in your employee survey, (can you tell we like surveys?? :)…) you can insure that employees aren’t left out in the cold when you change your plan selections.


Employee benefits, reporting, and compliance… These words produce fear and anxiety in many… But it doesn’t need to be this way!

The truth is this: Streamlining benefits at your company is a lot like investing… By doing the basics right, you can be in the top 10% fairly easily…

Or, you can be reactive and fall into the other 90%.

As simple as this sounds, the key is simply being proactive. One way to do this is to speak with a broker and/or HR consultant to help guide you through the steps in refining your HR and benefits practices… Another option, would be to enroll in a course like the one linked in this article to help guide you in covering the basics your company needs to be aware of.

The most common issues faced by small businesses today in these categories is due to negligence, and inaction. Your company does not need to be one of those affected.

Here are a few more basic areas to focus on to ensure you’re not letting things fall through the cracks:

Section 125 – Are you deducting benefits on a pre-tax basis? If so, do you have a current, complete, Section 125 plan document in place that includes your current plans and rules for participation?

Voluntary benefits – Are you offering voluntary benefits to your employees? Even if you don’t have the budget to contribute towards dental, vision, and life, why not offer these if they don’t cost you a dime?

Compliance – When was the last time you took your organization through a compliance audit of any kind? Like many things, the level of pain involved in a compliance audit is much less than you might be fearing. Most importantly, a well-done audit will give you a list of action items to execute on, and get your organization back in shape, and to minimize your liability.

Systems – Whether you use systems to track your benefits enrollments, deductions, etc… or just good old-fashioned paper… When was the last time you re-evaluated this? Here’s a link to an article on 6 questions to consider when choosing a benefits administration system.

Onboarding – Although it can be a hectic time of year for many reasons, open enrollment is an excellent opportunity to ensure your onboarding documents are up to date, and that all your employees have read and acknowledged the most recent version of each form. Provided you’re using a modern enrollment system, every employee in your organization will need to log in anyway, you might as well have them acknowledge whatever is needed while they’re in…

About the author: Wayne Smith

Add comment